Tullow grabs Peruvian offshore blocks

UK-based oil and gas company Tullow Oil has agreed terms to add six new licenses covering 28,000 sq km offshore Peru to its portfolio. 

The company said on Tuesday it has concluded negotiations with Perupetro and agreed to acquire a 100% stake in Blocks Z-64, Z-65, Z-66, Z-67 & Z-68.

The agreements are pending approval by supreme decree by the Peruvian Ministry of Energy and Mines and Ministry of Economy and Finance, with formal signing of the licenses anticipated in the first quarter of 2018.

Tullow has also agreed to acquire a 35% interest in the offshore exploration Block Z-38, Tumbes Basin Peru through a farm-down from Karoon Gas Australia, also subject to government approval.

The terms of the agreement between Tullow and Karoon include Tullow funding 43.75% of the cost of the first exploration well, capped at $27.5 million (at 100%), beyond which Tullow will pay its 35% share. Tullow will also pay $2 million upon completion with a further $7 million payable upon declaration of commercial discovery and submission of a development plan to Perupetro.

According to the company, the new acreage contains a number of attractive leads and prospects. The Z-38 license is already covered by high quality 3D seismic and includes the Marina prospect which is a potential candidate for drilling in 2019, Tullow added.

Karoon Managing Director, Robert Hosking, said: “Block Z-38 sits in the heart of the Tumbes Basin, adjacent to the prolific oil producing Talara Basin which has produced 1.7 billion BOE since 1880. The Tumbes Basin has a proven working petroleum system and evidence suggests the prospects in Z-38 are accessing the same source rocks as the giant onshore Talara Basin fields.

“Historically offshore Peru has experienced only limited exploration activity, however 2017 has seen a resurgence of interest and inflow of industry capital looking to test Peru’s exciting offshore potential. Anadarko was awarded 3 new offshore license contracts during 2017 along with offshore and onshore Technical Evaluation Agreements awarded to Repsol and Global Petroleum.”

Following completion of the agreement, joint venture partner equity interests in the Block Z-38 will be: KEI (Peru Z38) Pty Ltd, Sucursal del Peru with 40% interest; Tullow Oil 35%; and Pitkin Petroleum Peru Z-38 SRL 25% interest.

Elsewhere in South America, following completion of the Araku-1 well in Block 54 off Suriname, Tullow was granted a two-year extension for the adjacent Block 47 where the Goliathberg prospect is a potential drilling candidate for 2019.

Over in Guyana, processing of 6,500 sq km of 3D seismic data acquired during 2017 on the Kanuku and Orinduik licenses is ongoing to mature and rank identified prospects. Tullow said that preparations are under way to start drilling in early 2019, although options to bring drilling forward into late 2018 are being considered.

Offshore Energy Today Staff

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